An accountant's job is to present factual information through financial statements, so that managers, investors and regulators can make well-informed decisions.
But what if one or more accountants are directed to generate false reports, intended to deceive? Sleepless nights for everyone.
But what if one or more accountants are directed to generate false reports, intended to deceive? Sleepless nights for everyone.
Last week, shares in the "IKEA of Africa," Steinhoff International Holdings NV, plunged 82% after its CEO resigned and the company announced accounting problems could affect approximately $7 billion in assets.
It is alleged that finance folks at Steinhoff, which owns MattressFirm (USA), Poundland (UK) and Conforama (France), and has operations on five continents, have been using off-balance-sheet entities to hide losses and thereby inflate the firm's net worth and share price.
There's more subjectivity, estimation and judgment involved in accounting than many people realize. But when intent to deceive is introduced, it's a different ball game.
It appears that Steinhoff may join the ranks of names like ENRON, WorldCom and Sunbeam for accounting malfeasance. Sad.
Peter
It is alleged that finance folks at Steinhoff, which owns MattressFirm (USA), Poundland (UK) and Conforama (France), and has operations on five continents, have been using off-balance-sheet entities to hide losses and thereby inflate the firm's net worth and share price.
There's more subjectivity, estimation and judgment involved in accounting than many people realize. But when intent to deceive is introduced, it's a different ball game.
It appears that Steinhoff may join the ranks of names like ENRON, WorldCom and Sunbeam for accounting malfeasance. Sad.
Peter
Reminder: we will be speaking at the Winter HomeSchool Conference in Utah, USA on Jan 27, 2018. This conference is designed to help support and rejuvenate home educating parents who want to thrive, not just survive the homeschooling experience.
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